As more U.S. adults seek mental health care, the role of for-profit hospitals in this vital sector has surged. Recent data indicates that over 40% of inpatient mental health beds are now operated by for-profit entities, a significant increase from just 13% in 2010. This trend has been attributed to the Affordable Care Act’s provisions, which recognized mental health care as an essential health benefit that all insurance plans must cover.
Before the ACA was enacted, millions of Americans struggled to access meaningful mental health coverage. The legislation transformed the landscape by expanding access and increasing reimbursement rates, drawing the attention of for-profit corporations eager to capitalize on what has historically been a less lucrative field. However, experts are raising alarms about the potential consequences of this shift.
Research has consistently highlighted concerns regarding the quality of care in for-profit mental health facilities. These institutions often cut costs by reducing staff, which can directly impact patient care. A recent report from ProPublica has unveiled alarming patterns of violations of the Emergency Medical Treatment and Labor Act (EMTALA) among psychiatric hospitals, with over 90 institutions cited for violations over the past 15 years. A staggering 80% of these facilities are owned by for-profit companies.
Despite the gravity of these violations, few hospitals have faced significant repercussions. The U.S. Centers for Medicare and Medicaid Services (CMS) and the Department of Health and Human Services (HHS) inspector general, who are responsible for regulating compliance with EMTALA, have imposed only minimal penalties. In fact, the fines levied have often been trivial compared to the revenue generated by these for-profit hospital chains.
ProPublica’s analysis reveals that nearly half of the EMTALA violations were committed by just two corporations: Universal Health Services (UHS) and Acadia Healthcare. Together, these companies manage hundreds of inpatient and outpatient facilities. Last year, UHS reported nearly $16 billion in revenue, while Acadia surpassed $3 billion. From 2010 through the second quarter of this year, 34 UHS psychiatric hospitals were cited for EMTALA violations. In a rare instance of enforcement, two UHS facilities settled with HHS for a mere $375,000 after being found guilty of failing to accept appropriate patient transfers.
The lack of accountability is troubling. In one notable case involving Brentwood Behavioral Healthcare in Mississippi, hospital staff were directed to refuse transfers of uninsured patients, despite having the capacity to treat them. UHS has defended its compliance with EMTALA, stating that the violations were isolated incidents, but critics argue that such incidents expose a systemic issue within for-profit healthcare models.
Similarly, Acadia Healthcare has faced its share of scrutiny, with 12 of its hospitals cited for EMTALA violations since 2010. However, only one facility, Park Royal Hospital in Florida, has faced any substantial fines, amounting to just over $52,000. Acadia asserts its commitment to high-quality care, but concerns linger about the motivations of for-profit entities in psychiatric healthcare.
Dr. Jane Zhu, an associate professor of medicine, points out that financial incentives may drive these hospitals to deny care to patients lacking insurance or those with inadequate coverage. This “cream-skimming” approach allows facilities to avoid more complex cases and potentially costly patients in favor of healthier individuals, thus maximizing profits at the expense of those who require urgent care.
Despite the serious implications of these findings, both CMS and the HHS inspector general have refrained from commenting on the lack of consequences faced by for-profit psychiatric hospitals for their EMTALA violations. Federal law limits the maximum fines that can be imposed for such violations, which diminishes the deterrent effect. In fact, since 2010, fines have often been well below the maximum allowable amounts, leading many in the industry to view them as a minor cost of doing business.
Former officials from CMS and the inspector general’s office have expressed concern that the absence of significant penalties may encourage hospitals to prioritize profits over patient care, with CEOs willing to take the risk of violating EMTALA regulations.
U.S. Rep. Frank Pallone Jr., a prominent advocate for healthcare reform, emphasized the urgency of addressing these issues. “In the face of a large mental health crisis, we should be doing more, not less, to ensure people have access to the care and treatment they need,” he stated.
The growth of companies like Perimeter Healthcare, which has expanded aggressively since the ACA’s passage, further illustrates the troubling trend of for-profit entities in mental health care. Despite pledging to uphold high standards of care, facilities under Perimeter’s control have faced accusations of violating EMTALA by refusing to examine patients in crisis.
These alarming incidents highlight the broader systemic issues that arise when profit motives overshadow patient welfare in the healthcare industry. Lawmakers and regulators are increasingly concerned about the influence of private equity in healthcare, particularly in psychiatric hospitals. The growing presence of these entities raises critical questions about the quality of care provided and the ethical responsibilities of healthcare providers.
As we grapple with a rising mental health crisis in America, it is imperative that we hold for-profit healthcare entities accountable and ensure that legal protections for patients are not only enacted but also enforced. The consequences of neglecting this responsibility could be dire, as vulnerable individuals continue to face barriers to the care they desperately need.
